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Universal Credit rent arrears rocket says new research

Sally Walmsley
Written by Sally Walmsley

Almost two-thirds of private landlords with tenants receiving Universal Credit have experienced them going into rent arrears according to new research.

Based on responses from more than 2,200 landlords, the RLA’s research exchange, PEARL, has found that 61 per cent of landlords with tenants on Universal Credit have seen them go into rent arrears.

This is up from 27 per cent in 2016.

The research found that on average Universal Credit tenants in rent arrears owed almost £2,400, a 49 per cent increase compared to last year.

Over half (53 per cent) of landlords with tenants on Universal Credit applied for direct payment to be made to them instead of to the tenant, known as an Alternative Payment Arrangement (APA).

Where successful it took, on average, over 2 months for this to be organised, on top of the 2 months arrears already accrued. This has caused arrears to build up substantially.

Those landlords that have to wait for 2 months arrears before they can apply for direct payment are reporting that on average the APA process takes 9.3 weeks.

This when added to the initial 2 months arrears accrued means that landlords are on average owed 4 months’ rent before they are successfully awarded direct payment. The RLA is calling for the APA process to be improved as a matter of urgency, particularly before managed migration begins next year and more families and complex cases are moved onto Universal Credit.

One fifth of landlords also reported that their mortgage lender prevented them from renting homes to tenants in receipt of benefits.

The RLA is calling for tenants to be able to choose, where it is best for them, to have the housing element of Universal Credit paid directly to the landlord.

It is calling also for private landlords to be given more information about a tenant’s claim, such as when they receive payments, where this is in the best interest of the tenant to sustain the tenancy so that suitable rent payment schedules can be arranged. At present, this is provided to social sector landlords, but not to those in the private sector.

Formal mechanisms should also be put in place to enable landlords to reclaim rent arrears where UC tenants leave a property owing rent.

RLA Policy Director, David Smith, commented:

“Our research shows clearly that further changes are urgently needed to Universal Credit.

“We welcome the constructive engagement we have had with the Government over these issues but more work is needed to give landlords the confidence they need to rent to those on Universal Credit.

“The impact of the announcements from the Autumn budget last year remain to be seen. However, we feel a major start would be to give tenants the right to choose to have payments paid directly to their landlord. This would empower tenants to decide what is best for them rather than being told by the Government.”

– Ends –

  • The Residential Landlords Association: The home for landlords

–      The RLA represents the interests of landlords in the private rented sector across England and Wales. We’re home to over 50,000 landlords nationwide, with a combined portfolio of over a quarter of a million properties. A growing community of landlords who trust and rely on us to deliver day-to-day support, expert advice, government campaigning, plus a range of high-quality services relevant to their needs.

–      Further information about the RLA can be found at or by following it on twitter @RLA_News.

  • RLA PEARL: The home for research

PEARL, the RLA’s research lab, was set up to provide high-quality research and analysis on the economic, social, and political issues facing the private rented sector. The RLA believes in the importance of policy makers considering the evidence and the potential consequences in their decision-making. Through PEARL, we provide the expertise, evidence, and research, to enable evidence led policy making in the private rented sector. Our ultimate aim is to influence decision makers in order to translate our research findings into an improved renting experience.

–      Further information about RLA PEARL can be found at or by following it on twitter @RLA_PEARL

–       Of those landlords with tenants on Universal Credit, 61% experienced them going into rent arrears in the past 12 months. This is up from 38% last year and 27% in 2016.

–       The average amount owed by Universal Credit tenants in rent arrears has increased by 49% in comparison to the previous 12 months. It has increased from £1,600.88 in 2017 to £2,390.19.

–       53% of landlords with Universal Credit tenants reported that they had requested an Alternative Payment Arrangement (APA) and of these, 57% reported that it had been successful. Furthermore, 53% of landlords reported that they had included a claim for the repayment of rent arrears in the APA. Respondents were then asked how easy they had found the APA application process, 51% of landlords reported they had found it difficult or very difficult. Respondents were asked how long on average it took them to have the APA arranged. On average, landlords reported that it took 9.3 weeks for direct payment under the APA to be arranged, with the maximum reported to be a full year.

–       22% of landlords reported that their mortgage lender prevented them from renting homes to tenants in receipt of benefits.

  • For further information please contact the RLA’s consultant, Ed Jacobs on 0113 278 0211 (office), 07706386773 (out of office hours) or email

About the author

Sally Walmsley

Sally Walmsley

Sally Walmsley is the Magazine and Digital Editor for the NRLA. With 20 years’ experience writing for regional and national newspapers and magazines she is responsible for editing our members' magazine 'Property', producing our articles for our news site, the weekly and monthly bulletins and editorial content for our media partners.

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